Commercial breeders take 'long term view' at SA's Merino ram sales

With mutton prices falling below $1 a kilogram for the first time in 16 years and lamb prices nearly halving, it could have been a very different result.

But as the season draws to a close, two prominent stud stock auctioneers say commercial Merino breeders have taken a long term view in their buying.

Many would love to see the wool market rally but it has at least held its ground with the Southern Micron Price Guide for 20 micron wool only down 2 per cent on the same time last year at 1315 cents a kilogram clean. The 21MPG is 14c/kg higher at 1296c/kg.

Nutrien SA stud stock manager Gordon Wood admits he was being optimistic predicting only a 10pc decline in averages but says the result is "far and away in front of what he anticipated".

He says some commercial breeders did pull back their budgets but many used the opportunity to purchase better quality rams with the same budgets as 2022.

"When there is a drop in the market, people often find ways to reduce their spending but a lot of people that I spoke to in the last few months said our ewes need rams so there is no point pushing ourselves into a corner for next year and having to buy twice as many," he said.

"The interesting thing was stud breeders were the ones that were more apprehensive and subdued in their bidding - some of them missed some opportunities."

Elders SA stud stock manager Tony Wetherall agreed that commercial breeders had focused on the many years of strong lamb and mutton prices.

"It wouldn't have been realistic, given where we are for prices of lamb and mutton, to stay the same as 2022 but to be within 10-20pc of last year's average, they would have to be happy," he said.

"Wool producers are particularly resilient and know there is going to be an end to what they are experiencing at the moment so they are continuing to invest in their breeding flocks and wool is continuing to pay bills."

He said there were a "lot of good stud sales" but the joint Collinsville-East Bungaree sales at Hallett last month, where 600 rams were sold on the one day, was a highlight for him.

It also produced the season's $70,000 highest price with Merino ram Collinsville Buddy 220032 sold to WA.

Mr Wood said Merino breeders were conscious of the ethical standards many consumers were demanding and were shifting towards studs able to satisfy Responsible Wool Standards program criteria, including non-mulesed rams.

The drive for performance data also remains strong, according to Mr Wood, with more and more people jumping into studs that could provide this information.

"It may be a few pages promoted to those who want to see them in a folder at the sale, whether it is available in the catalogue is another story but a lot more studs are offering data," he said.

Mr Wetherall says buyers are also looking for the "modern day Merino", which is plain bodied with good carcase qualities and good lambing percentages while many were also looking for Australian Sheep Breeding Values.

Merino SA president Matt Ashby says the ram sale season opened strongly on the Eyre Peninsula in July and August, where a few good grain harvest years had buoyed prices, but even the Mid North sales in September "held up well".

He acknowledged the Merino industry has faced some challenges, including shearer shortages, but was confident the dual income Merinos offered would keep many in the breed.

"Between January and June last year in the Mid North there were nine Merino flock dispersals but that seems to have slowed and the pastoral areas are rebuilding, which is helping numbers," he said.

"Last year many of the studs increased their numbers and kept them but we sold nearly the same numbers again this year which is pleasing."